Effective from 1st April 2020, Tax Rebate under Sec.87A was revised in Budget 2019. Because of this, there is no tax liability for those whose total taxable income is up to Rs.5,00,000.
Revised Tax Rebate under Sec.87A after Budget 2019
- You must be a RESIDENT INDIVIDUAL
- Your Total Income, after Deductions, (like under Section 80C) is equal to or less than Rs.5,00,000 (Earlier it was Rs.3,50,000).
- The rebate is limited to Rs.12,500 (Earlier it was Rs.2,500).
It means if your total tax payable is lower than Rs.12,500, the amount will eligible for a rebate under Sec.87A. Do remember that the rebate should be applied to the total tax before adding the education cess (4%).
Do remember that there are no income tax slab rates changes for FY 2019-20. However, due to changes in Sec.87A, you can assume that if your taxable income is less than Rs.5,00,000, then your tax liability should be zero.
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